Demetriou was responding to a report by Melbourne newspaper Herald Sun, which claimed the AFL could consider paying Franklin to be an "ambassador" for the game in the expansion area of western Sydney.
The game's boss was quoted as saying the league would look at options for an ambassadorial role for the freakish goal-kicking talent, should he join the Giants under free agency at the end of the season.
But, Demetriou lashed the report, declaring his top desire was to see Franklin stay with the Hawks.
The AFL on Tuesday also released a blunt statement declaring there was no way the league would ever be involved in the recruitment of any player.
Franklin heads into the last year of his contract with Hawthorn this year and has delayed talks for a new deal to stay with the Hawks, sparking claims he could be the latest big name to move to an expansion outfit.
"I want Buddy Franklin to stay at Hawthorn," Demetriou declared to sports specialist radio SEN on Tuesday in Melbourne.
"Under no circumstance would the AFL be, in any way, involved in trying to recruit any player to any club, as we wouldn't do.
"And for then that to be extrapolated (in the report) into, 'well, what happens if he does go to the GWS and they get him?' and I said, 'well, if that's the case, if they were to procure him and our commercial people came to me and said to me he would be good value as an ambassador, then we would consider it'.
"But under no circumstances... the AFL is not interested in inducing any player for any club, to go to any other club.
"We wouldn't do it.
"I want Buddy Franklin to stay at Hawthorn because he's a great player and that is the end of the story.
"Let's be very clear and let's not get people up in arms and let's not exaggerate things and make up things."